UK increases surveillance on e-commerce VAT

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E-commerce businesses selling goods to private individuals will be subject to an increasing control by HMRC. A number of measures have been approved to counteract the e-commerce VAT gap , including the obligation to register via a fiscal representative in the UK (with joint responsibilities on the representative) and further formalities on the online platforms (eg. Ebay, Alibaba, etc). These measures will focus on non-EU online businesses, as they are believed to concentrate the VAT gap in this industry.

Denmark has recently introduced a similar initiative allowing the tax authorities to request more information from taxpayers selling goods online. We would expect more changes and increasing controls in other European countries as member states increase awareness of the VAT leakage on online sales.